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Facebook runs, Google takes cover in news fight Down Under

Facebook's corporate headquarters location in Menlo Park, Calif. in March 2018. Josh Edelson/AFP via Getty Images
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Facebook and Google are taking different paths with news publishers as an Australian fork in the road nears. Here’s what you need to know:

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What Australia wants to do: The country’s proposed news media bargaining code, which could be enacted as early as this week, aims to “address the fundamental bargaining power imbalance between Australian news media businesses and major digital platforms.” It would initially apply just to Facebook and Google, with the possibility of adding other tech companies in the future.

It’s noteworthy that this battle with Big Tech has emerged in Australia’s unique landscape, known for its history of market intervention and one of the most concentrated media industries in the world—dominated by News Corp’s Rupert Murdoch. 

How Facebook responded: The social media giant announced it will restrict publishers and people in Australia from sharing and viewing local and international news. “The proposed law fundamentally misunderstands the relationship between our platform and publishers who use it to share news content,” Facebook said. The company said it made the choice, which some called the “nuclear option,” with a “heavy heart.” As part of the restrictions, local publishers won’t be able to share or post content on their pages, and international publishers’ posts and links won’t be viewable or sharable in Australia.

Google took a different approach: It struck eleventh-hour deals to pay some Australian publishers for content. News Corp announced a three-year agreement, through which a number of its publications—including The Wall Street Journal, the New York Post, the U.K.’s The Times and Australia’s Sky News—will join the Google News Showcase for “significant payments.” (Google did first threaten to make its search engine unavailable in the country.) The tech company made a similar deal with French publishers last month.

Canada is taking notice: The Australian code is being watched closely as a potential precedent for similar regulations to support publishers in the EU, U.K., and Canada. Heritage Minister Steven Guilbeault told my colleague Martin earlier this month that the government will put forward similar legislation that would force both companies into arbitration if they can’t agree with news publishers on how much to pay for content.

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The precedent: It’s not the first time unfriendly legislation has prompted a tech tantrum. When Spain passed a law in 2014 that required news aggregators to pay for a licence to use news content, Google shut down Google News in the country. Some data reviewed by the News Media Alliance showed the move was not all that bad for news organizations, with the shuttering creating a low and temporary—if any—reduction in traffic.